Managing Specialty Crop Risk in North Carolina: A Working Paper
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1 Managing Specialty Crop Risk in North Carolina: A Working Paper James Robinson, Research & Policy Associate, RAFI Scott Marlow, Executive Director, RAFI Michelle Madeley, MPH-MCRP Candidate, UNC Chapel Hill Rural Advancement Foundation International October 9, 2013
2 Introduction
3 NC Farm Receipts by Commodity Broilers Hogs Turkeys Chicken eggs Cattle and Calves Dairy Other Poultry Miscelaneous Livestock Soybeans Cotton and cotton seed Corn Tobacco Wheat Peanuts Hay Greenhouse / Nursery / Floriculture / Christmas trees Vegetables and Melons
4 NC Farm Receipts Specialty Crops 13% Tobacco 4% Commodity Crops 17% Livestock and Dairy 66%
5 Research Overview Purpose of Research: Prioritize specialty crops for the development of crop insurance policies based on crop vulnerability to disaster losses and specialty crop producer needs, as well as identify needed reforms to existing policies. Focus of Report: Identify specialty crops that are most vulnerable due to the lack of crop insurance availability, Identify crop insurance and risk management programs for specialty crops that can serve as models to build on, Determine what farmers want in a crop insurance policy so that future crop insurance policies will provide coverage based on farmers needs, and Use farmer input and data analysis to suggest changes to existing specialty crop insurance policies as well as propose new policies.
6 Research Components Analysis of RMA data on availability and use of crop insurance by specialty crop growers. Mapping of North Carolina specialty crop risk through analysis of Farm Service Agency Data on disaster declarations by county and North Carolina Department of Agriculture data on specialty crop income by county. Collection of data from specialty crop growers related to their knowledge of, use of, and recommendations for crop insurance reform.
7 Methods
8 Grower Data Collection Methods Survey of Specialty Crop Growers from North Carolina 157 growers responding Wide variety of specialty crops grown by respondents Small-scale farmers overrepresented in survey Focus Groups 7 focus groups with 3 to 8 growers participating per group Sit Visits 11 sit visits with growers ranging from 1 acre to 450 acres
9 Analysis of Crop Insurance Availability and Need
10 Crop Insurance Needs Analysis Value of uninsured crops Enrollment rate for insured crops Yield per acre variance of each crop Price per unit
11 Uninsured Specialty Crops in 2012 Uninsured Crops 2011 Value of Production North Carolina Yield Per Acre Variance Between 2003 and Price Per Unit/Unit Floriculture $250,495,000 No Data N/A Sweet Potatoes $208,675, /Cwt Christmas Trees $75,000,000 No Data N/A Tomatoes $52,800, /Cwt Bell Peppers $30,134, /Cwt Watermelons $29,070, /Cwt Cucumbers $27,897, /Cwt Strawberries $27,300, /Cwt Squash $25,740, /Cwt Sweet Corn $13,132, /Cwt Snap Beans $7,028, /Cwt Total $747,271, N/A N/A
12 Insured Specialty Crops In 2012 Insured Crops 2011 Value of Production North Carolina 2012 Percentage Insured Acres Yield Per Acre Variance Between 2003 and Price Per Unit Blueberries $66,320, % /Lb Potatoes $24,478,000 84% /Cwt Apples $22,532,000 71% /Lb Cabbage $12,827,000 21% /Cwt Peaches $5,150,000 48% /Ton Grapes $5,101,000 13% /Ton Total $136,408, N/A N/A N/A
13 Mapping Specialty Crop Risk in North Carolina
14 Mapping Risk Data Methods USDA s Farm Service Agency total disasters declared, for each county, from 2008 to 2012 Specialty crop production in each North Carolina county from from the North Carolina Department of Agriculture (NCDA) AgStat Report.
15 Mapping Specialty Crop Risk
16 Analysis of Grower Survey Data
17 Specialty Crops Grown
18 Greatest Financial Risk Sources
19 Weather Events Causing the Greatest Financial Loss
20 Is Crop Insurance Available for Your Specialty Crop?
21 Knowledge of Crop Insurance
22 Knowledge of Crop Insurance & Specialty Crop Acres in Cultivation
23 Knowledge of Crop Insurance & Years Farming
24 Type of Crop Insurance Best for Your Specialty Crop Operation
25 Importance of Crop Insurance When Determining Crops Grown
26 Production-based Risk Management Practices Used Other Than Crop Insurance
27 Conclusions
28 1. Expand grower outreach and education about crop insurance. 2. Develop additional specialty crop singlecrop policies to cover currently uninsurable crops. 3. Reform whole-farm revenue insurance to better cover beginning farmers and expanded crop production. 4. Incentivize production-based risk management in crop insurance policies through premium reductions for best practices.
29 Contact Scott Marlow or James Robinson with any questions. James Robinson: ext. 209 Scott Marlow: ext. 210
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